Examining .ai Domains and Their Additional IT, Compliance and Legal Requirements

Artificial intelligence (AI) has captured the world’s attention and imagination, fueled by controversial breakthroughs such as OpenAI’s ChatGPT which are forever altering life as we know it. The impact of AI has also substantially impacted the domain name world, marked by the recently-surging use of the .ai top-level domain (TLD).

Dan Primack of Axios Pro Rata reported on May 31, 2023, that .ai domain name registrations were up 156% from May 2022 to May 2023, while .com domains saw a more modest 27% increase during the same period. According to WHOIS data, as of June 14, 2023, the total .ai domain count was of 248,609 domains, nearly doubling the 143,737 domains recorded on July 20, 2022.

Lauren Tracey, Domain Strategy and Advisory Manager at GoDaddy Corporate Domains (GCD) explains, “Many companies with fully flushed-out AI products bought .ai domains several years ago, but the real increase in interest in the past few years resulted from many new AI products coming to market. Organizations often buy .ai domains for brand protection, to effectively prevent others from buying them first. Their .com domains still come first.”

Cecilia Borgenstam, Partner and Co-Founder of SILKA, a boutique consulting company which specializes in domain name disputes and website takedowns, supports the strategy of defensive registration to include .ai domains, among other TLDs. Borgenstam comments, “It is easy for anyone to register a .ai domain, but having to recover it from a third party requires domain dispute expertise and carries substantially higher costs.”

The Unique Origin of .ai Domains

With exotic roots, the .ai country code top-level domain (ccTLD) originates in Anguilla, a British territory in the Caribbean. For that reason, choosing a .ai domain entails compliance with unique Anguillan restrictions and legal regulations that differ from those typically associated with generic top-level domains (gTLDs).

Google’s Revised Treatment of .ai Domains

Gary Illyes, Analyst at Google, shared that as of June 2023, .ai domains are treated as gTLDs in Google searches. Illyes said, “[Google] won’t infer the target country from the ccTLD so targeting Anguilla became a little harder, but then again there are barely any domains that try to do that anyway.” Thus, .ai joins the ranks of other domains that straddle gTLD/ccTLD status such as .co (which is used both as an alternative gTLD to .com as well as a ccTLD for Colombia).

Google’s move effectively removed one of the major roadblocks that caused companies to hesitate when buying .ai domains. In a recent Search Engine Journal article, Matt G. Southern reports, “This update is significant for businesses and SEO professionals previously avoiding the use of .ai domain names for fear of Google associating them with Anguilla. The new classification removes the concerns, and such domains can now be used without the worry of geo-specific targeting to Google’s algorithms.”

However, Google’s amendment is not necessarily a panacea that cures all issues. Companies related to AI that are considering the purchase of .ai domains need to be aware of all ramifications, including additional burdens which will likely be placed on their corporate IT and legal departments.

Compliance Issues with .ai Domains

Since Anguilla is a British territory, GDPR data privacy regulations will apply to areas like WHOIS, which shows information about domain registrants. Any company doing business should ensure compliance with local regulations like GDPR for Europe, various state compliances for the U.S., and other international laws governing data privacy. A good rule of thumb is to comply with the strictest statutes which will naturally ensure compliance with less stringent ones.

How Anguilla Handles Domain Disputes

Doug Isenberg of The GigaLaw Firm is a global domain name lawyer and domain name panelist for the World Intellectual Property Organization (WIPO) and other domain name dispute providers around the world. He notes, “There are more restrictions on .ai domains than others like .com. Although .ai is an open TLD, meaning that registrations are available to anyone to buy on a first come, first served basis, there are some grounds for which the Anguillan government will suspend or revoke a .ai domain name registration, and these go beyond just trademark-related issues to also include phishing, hate speech, copyright violations, etc. Therefore, Anguilla could revoke a company’s .ai domain even without any evidence of a trademark violation. The recent increase in total number of .ai domain registrations will inevitably lead to more .ai domain name disputes.”

Adding more clarification to Isenberg’s comments, Trisha Ytuarte, Customer Success Manager at GCD, remarks, “Anguillan laws pertaining to .ai domains mostly center around preventing what they describe as ‘scammish’ activity, copyright/trademark violation, or propagation of illicit content such as pornography, which are commonly restricted by most governments anyway.”

Ytuarte notes that Anguilla offers unrestricted registration for domains, meaning that they recognize the rights of holders on a global scale. Therefore, in the event that a registered trademark holder identifies a trademark infringement by a .ai domain registrant, Anguilla would uphold the right of the company that originally and legitimately registered the trademark. If there is a dispute, Anguillan government follows the Uniform Domain Name Dispute Resolution Policy (UDRP) which provides an effective mechanism for dispute resolution.

UDRP’s All-Electronic Dispute Resolution

UDRP is a contractual arbitration-like process by which a trademark owner can file a complaint against a domain name registrant regarding a domain name that contains, or is confusingly similar, to a trademark—which is basically known as ‘cybersquatting’. Instead of filing a lawsuit and going to court, the most common way in which trademark owners resolve cybersquatting issues is to use the UDRP process, which is significantly faster, easier and less expensive than courts.

Isenberg comments, “Since the UDRP is a fairly streamlined process, a trademark owner can typically get a decision within two months of filing a complaint—which is short compared to in-court litigation time.”

About 42 countries, including Anguilla, have adopted the UDRP. “If there is an .ai domain dispute, it’s not necessary for the trademark owner to have a trademark registration in Anguilla,” Isenberg stated. “If the complainant has trademark rights in the U.S. or any other market, that would be sufficient to bring the dispute.”

UDRP Disputes Require Electronic Evidence

The UDRP process is now entirely electronic, with all forms and documentation being submitted online. Though UDRP cases have no electronic or paper-based discovery with no hearings or motions, the company bringing the dispute must be able to locate and upload documentation relevant to the case.

Isenberg emphasizes, “A good, strong UDRP complaint needs to make out all the appropriate factual and legal arguments in the strongest manner possible. The complaint should be well-argued and supported with appropriate evidence. I have seen too many ‘bare bones’ complaints that don’t make appropriate arguments and are not supported by relevant evidence. Using an attorney experienced with UDRP disputes is highly recommended because it’s very difficult to refile a complaint if you lose one. Do it right the first time with a strong, thoroughly researched complaint—don’t take the domain name dispute process for granted.”

Tips to Win a .ai Domain UDRP Dispute

SILKA has won more than 800 domain name disputes, including some that involve .ai domains. Klara Sigvardsson, Partner and Co-Founder of SILKA, recommends, “To win a UDRP dispute, a trademark owner must prove that the current owner of the domain name has registered and used this domain name in so-called bad faith—that they were aware of the trademark and are knowingly, intentionally exploiting the brand. Even in cases where this seems obvious, it isn’t always so easy to prove.”

According to SILKA, one key aspect that may have relevance for .ai domain names is the geographic location of the current domain name owner and whether the complainant has legal rights registered in Anguilla. Sigvardsson explains, “If the domain name owner lives in Anguilla and the trademark owner’s TM does not cover Anguilla, this could make it easier for the defending domain name owners to argue (truthfully or not) that they were not aware of any other rights to this name. If it can’t be argued that the current domain name owner must have known about the trademark when registering the domain name, then bad faith can be tricky to prove and that would make it more challenging to win the UDRP. The prospective complainant will be able to make a more informed decision on whether the UDRP process is appropriate by reviewing the website connected to the domain name, the owner’s geographic location, and the composition of the domain name.”

.ai Domain Cases So Far

SILKA notes that in 2023, there have been only approximately 20 UDRP administrative domain name disputes concerning domain names ending in .ai, including parties like IBM, Infosys and ConnectWise. Sigvardsson states, “A common theme with .ai UDRP cases so far is that most of the disputed domains are exact matches of the trademark (e.g., BMW.ai, AstonMartin.ai, ConnectWise.ai) rather than the disputed domain combinations and misspellings typically seen under more well-established TLDs like .com. Given the revolving impact that AI will have on virtually all industries, we expect to see more companies disputing .ai domains that infringe on their brand.”

Conclusion

Companies should consider the value of adding more domains with varying TLDs—like .ai—to support their branding and domain protection strategy. Securing .ai domains for trademark protection can be an inexpensive and straightforward process. While .ai domains may serve as secondary to the company’s primary .com properties, they play a crucial defensive role in preventing potential cybersquatters, confusion, and scams that could harm a reputable brand.

However, it’s important for companies to acknowledge that registering .ai domains comes with added responsibilities in terms of IT, legal and compliance.

One thing that is certain: .ai domains are now being associated with artificial intelligence, not just as ccTLDs for Anguilla, and they are here to stay. It will be fascinating to see how this trend unfolds as AI continues to transform the world as we know it.

Phil Lodico is Head of GoDaddy Corporate Domains (GCD), an innovative domain name registrar which leverages both experienced consulting services and an advanced domain management technology platform to assist corporate clients. Lodico is a longstanding veteran in the domain industry, having founded and run many successful organizations over the past 20 years. Email him at phil@gcd.com.

This article first appeared in the September 25, 2023 issue of Legaltech News.